November 18, 2025, saw US stocks retreat as concerns over an AI bubble and a struggling economy cast a shadow over investor sentiment. The major US indices experienced losses, marking a rough four-day streak of declines for many. The Dow Jones Industrial Average fell approximately 1.1%, translating into nearly 500 points lost, with the S&P 500 and Nasdaq Composite also declining by around 0.8% and 1.2%, respectively.
In the cryptocurrency market, Bitcoin briefly fell below the $90,000 mark for the first time in seven months. This dramatic decline contributed to a broader sell-off that has erased all gains the leading cryptocurrency had made throughout the year, further amplifying risks associated with speculative investments.
The day was particularly tough for technology stocks, with firms highly exposed to the AI narrative facing increased scrutiny. Nvidia (NASDAQ: NVDA) led the charge downwards, sliding approximately 2.7% in anticipation of its upcoming earnings report. This drop was mirrored by fellow tech giants Amazon (AMZN) and Microsoft (MSFT), which saw their shares decrease by around 4.3% and 2.7%, respectively.
Eyes are also on key economic data releases. The September jobs report is set to be revealed on Thursday, providing critical information concerning the Federal Reserve's next moves regarding interest rates. Following the previous US shutdown, this report holds substantial weight, with traders currently pricing a 50-50 chance of interest rate cuts.
In the retail sector, Home Depot (HD) struggled, cutting its full-year profit expectations after reporting a disappointing earnings miss, contributing to a further decline in market sentiment. With major retail earnings on the horizon from chains like Walmart (WMT) and Target (TGT), investor sentiment towards consumer strength is being closely monitored as the holiday season approaches.
According to a recent Bank of America survey, investors are increasingly concerned about the potential for an AI bubble, with 45% of fund managers identifying it as a significant economic risk. This heightened anxiety is compounded by the fact that a majority now believe companies are overinvesting in capital expenditures related to AI.
Slightly shifting the narrative, the Russell 2000 index bucked the broader trends, gaining nearly 0.52% on the day, indicating strength among smaller-cap stocks. Markets are digesting these conflicting signals while keeping a close watch on earnings and economic indicators in the coming days.
In conclusion, market sentiment remains cautious as investors weigh AI-related risks alongside upcoming economic data that could influence Federal Reserve policy. With major earnings reports on the horizon, including Nvidia, the state of investor confidence and market direction remains uncertain.